Iran Conflict Raises Costs for Chip Materials and Supply Chains

Rising energy and freight costs tied to the Iran conflict are affecting semiconductor manufacturing. Helium, produced as a byproduct of natural gas, has become harder to obtain after strikes limited export capacity from Qatar, which supplied over 30 percent of the global market in 2025.

Access to bromine and aluminium has also been disrupted. In March, chip buyers in Europe paid higher prices and drew from backup inventories when air freight routes were affected.

TSMC is increasing inventory buffers and diversifying sourcing locations. The company stated it is developing multi-source supply solutions to build a diversified global supplier base and improve local supply chains. VAT Group reported supply chain disruptions that forced rerouting of shipments.

The company said first-quarter sales fell 20 to 25 million Swiss francs while it expects no material impact on its full-year 2026 outlook.

Energy costs remain the most immediate issue for manufacturers. Prolonged conflict could raise component costs, affect vendor margins, and influence AI data center economics. Analysts note that companies with safety stock, diversified sourcing, and pricing power on manufacturing capacity are better positioned. Others may face increasing cost pressure through the rest of 2026.